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Mafia still has economic impact

Vincenzo Licciardi, a top mafia leader linked with Naples' deadly gangland warfare is escorted by Italian policemen in Cuma, west of Naples, on February 6, 2008.

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KAI RYSSDAL: It's not everyday you get to use names like "Tommy Sneakers" and "Jackie the Nose" on a business program, but sometimes the news is what the news is. U.S. and Italian police arrested scores of suspected mobsters in New York City and Sicily today. Among them, some of the capos of the Gambino crime family. Charges include racketeering, conspiracy, embezzlement of union funds and money laundering. That's just a sampling. The Mafia's influence in Italy's well documented. It's why garbage collection in Naples has ground to a smelly halt, but we wondered just how much La Cosa Nostra still influences business in the U.S.

From New York, Ashley Milne-Tyte reports.


ASHLEY MILNE-TYTE: The mafia's influence has waned over the years, but FBI agent Jim Margolin says the mob still has a significant economic impact. They're still deeply involved in the construction industry, judging by today's indictment, but Margolin says a few years ago members of the Gambino family thought up a couple of more white-collar schemes…

JIM MARGOLIN: One of which involved telephone cramming, which was a system whereby pennies-per-transaction charges were tacked onto thousands of telephone users' bills.

Margolin says both enterprises together netted the family $500 million. He says the mafia has also dabbled in stock manipulation. That's a world away from the mob's traditional areas of control, like the transportation business or the docks. Larry McShane of the New York Daily News has covered organized crime for 20 years. He says the mafia would slap a tariff on goods coming into U.S. ports.

LARRY McSHANE: A lot of products coming in on the waterfront, that was the case. The term that law enforcement uses is a "mob tax." You know an extra dollar or two on the cost of items that just goes back to them, just like a normal tax would go to the government."

Retired federal agent Joe King teaches at the John Jay College of Criminal Justice. He says the mafia is still going strong in cities like Philadelphia, Atlantic City, Vegas, Boston and New Orleans, but they're particularly active in New York -- mostly due to their involvement in the unions.

JOE KING: I would be willing to bet you that any union that's worth its weight has infiltration of some kind. If not at the highest level, then behind-the-scenes level. The truck drivers, the garment industry. . .

He says given the amount of money and business unions control, they're still an irresistible hunting ground for the mob.

In New York, I'm Ashley Milne-Tyte for Marketplace.

About the author

Jeremy Hobson is host of Marketplace Morning Report, where he looks at business news from a global perspective to prepare listeners for the day ahead.

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